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AT&T backs off threat to halt its fiber rollout

Matt Hamblen | Dec. 2, 2014
AT&T now says it will continue its already-announced fiber optic network expansion to 100 cities, backtracking on comments by AT&T CEO Randall Stephenson after President Obama voiced support for net neutrality last month.

AT&T now says it will continue its already-announced fiber optic network expansion to 100 cities, backtracking on comments by AT&T CEO Randall Stephenson after President Obama voiced support for net neutrality last month.

The move brought a strong retort from critics who say the carrier's fiber optic plans are mostly bogus and were designed as a competitive play against the ongoing Google Fiber rollout. The purported delay in AT&T's investments was quickly seen as an empty threat.

In a letter to the Federal Communications Commission (FCC) sent Nov. 25, AT&T said won't limit future fiber-to-the-premises deployments to 2 million homes as part of its $49 billion deal to acquire DirecTV. That contrasts with what Stephenson said Nov. 12.

"To the contrary, AT&T still plans to complete the major initiative we announced in April to expand our ultrafast GigaPower fiber network in 25 major metropolitan areas nationwide." Robert Quinn, AT&T senior vice president for regulatory matters, said in the letter.

In his Nov. 12 appearance at a Wells Fargo investors conference, Stephenson had said AT&T would stop fiber rollouts beyond the 2 million for the DirecTV deal: adding: "We can't go out and just invest that kind of money deploying fiber to 100 cities other than these 2 million not knowing under what rules that investment will be governed." The 100 cities are included in the 25 metro areas AT&T cited in its letter to the FCC. Stephenson later said to Fox Business Network that it might be two to three years before AT&T starts investing again in fiber optic network rollouts to 100 cities.

Since it won't limit its fiber deployment to 2 million homes, AT&T also told the FCC that it didn't need to provide documents surrounding any decision to delay. AT&T also redacted from public view any details on its fiber rollout in the letter.

Stephenson has been a leading critic of Obama's proposal that Internet providers be regulated like utilities under Title II of the Federal Communications Act. At the same time, AT&T needs the FCC's approval of the DirecTV deal.

On Monday, AT&T spokesman Mark Siegel said the FCC letter "makes clear that we are keeping our DirecTV merger-related investment commitments, which includes our previously announced fiber deployment plans." He also called Obama's proposal a way to "regulate the entire Internet under rules from the 1930s designed for voice services [that] inject significant uncertainty into the economics underlying our investment decisions. As a result, we have paused consideration of any fiber deployment investments that would go beyond what we've already announced."

Several analysts and activist groups reacted negatively to the Nov. 25 letter from AT&T to the FCC.

 

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